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Bank of Japan still has that sinking feeling

Bank of Japan Gov. Haruhiko Kuroda speaks at a press conference in March.

TOKYO -- April 4 marks the third anniversary of the introduction of the Bank of Japan's "quantitative and qualitative" monetary easing policy. Yet the battle against the country's persistent deflation is far from being won.

     Corporate earnings in Japan look set to hit a record in the fiscal year to March, but the gloomy inflation outlook is discouraging business owners from increasing capital investment or raising wages. Abenomics, Prime Minister Shinzo Abe's reflationary policy mix, is losing the tailwind of a weaker yen and higher stock prices. And it is unclear whether the BOJ's negative interest rate will help the central bank achieve its 2% annual inflation target.

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